Common classifications of wallets

Hot and cold: The most common way to classify wallets, these heat level descriptors indicate their connection to the Internet. Hot wallets are connected, while cold wallets are not.
Self-custody and third-party custody: This classification segregates wallets based on who has the ability to move one’s funds. Third-party custody wallets hold private keys managed by a third party, which means that an external custodian manages funds. Conversely, non-custodial wallets are private key repositories that are self-managed by the institution or individual. This means that funds are internally managed by the institution or individual themselves.

For for yourself Here https://levain.tech/blog/digital-asset-custody-security#:~:text=Hot%20and%20cold%3A%20The%20most,ability%20to%20move%20one's%20funds.

Share your opinion about CLASSIFYING WALLETS AND HOW TO PROTECT ASSETS IN WALLETS?

Thank you for your concise and easily understandable feedback

I. Some Common Types of Wallets

1.Centralized Wallet

*When people participate in cryptocurrency trading on centralized exchanges like Binance, Kucoin, OKEX, they create a trading account on the exchange. Within this account, the exchange provides wallets for all listed coins/tokens. Users simply need to select the correct coin/token they want to deposit, copy the wallet address, and send their funds.

*Example: On Binance, go to Wallet ⇒ Fiat and Spot ⇒ Choose the coin/token you want to deposit/withdraw and proceed with the transaction. In this type of wallet, users don't need to save a private key but only need to remember their exchange account password. However, the security level is lower compared to decentralized wallets, as the exchange has full control over your assets, and there is a third-party risk (the exchange) in case of issues.

2.Decentralized Wallet

Hot Wallet: This type of wallet allows users to trade anytime through an internet connection. It's free, offers more diverse options, and can be accessed through mobile apps or browser extensions. However, it's more susceptible to hacking because the Private Key data is stored directly in the app or extension and is constantly connected to the internet.

Cold Wallet: Typically in the form of a USB device, it functions similarly to a bank account. It automatically receives funds when someone sends them to you without needing an internet connection. However, if you want to check your balance, you need to connect the cold wallet to the internet, similar to internet banking. Cold wallets offer high security but come at a higher cost and lack the flexibility of hot wallets.

3.Other Types of Wallets

Smart Contract Wallet: These wallets are accessed and controlled through smart contracts. There are two types—those owned by external accounts accessed through a private key or seed phrase, and contract accounts controlled through smart contracts. They resemble traditional financial apps more and include features like multi-signature authorization, account freezing, transaction limits, 2FA, and permission for listings and custodianship.

Examples: Argent, Gnosis Safe.
II. Reasons for Asset Loss and How to Handle Them

Below are some common reasons for losing your assets and how to deal with them:

1.Approving Unknown NFTs/Tokens.
2.Forgetting to disable automatic downloads in Telegram.
*Many crypto groups and projects are on Telegram, but to avoid scams and malicious code, it's essential to disable automatic downloads.
To do this:

*Go to "Settings" in the Telegram app.

*Scroll down to "Chat Settings."

*Toggle off "Save to Gallery" for added security.

3.Visiting fake or scam project websites.

4.Signing messages on Metamask through non-legit websites.

5.Approving Smart Contracts on various projects.

6.Failing to revoke high-risk tokens when participating in DeFi projects.

7.Being a victim of browser extension wallet hacks.

8.Having keywords or private keys captured by attackers.

III. Ways to Protect Your Wallet

In this article, we will focus mostly on Metamask since it's widely used:

1.Secure Private Keys and Passphrases

When creating a wallet, you receive a 12-word secret passphrase. Write it down on paper and store it in two different places or save it on a USB drive. Avoid taking pictures or storing it on internet-connected devices.

2.Use Multiple Wallets for Different Purposes

*Create multiple wallets or accounts within Metamask for various purposes. For example:

*One wallet for Airdrops.

*Another for long-term asset storage (not staking or farming).

*Separate wallets for different DeFi activities.

3.Avoid Interacting with Unknown Tokens

Your Metamask wallet address is public, and anyone can send tokens to it. Over time, you may accumulate unknown tokens. Resist the temptation to interact with them. Use blockchain explorers like Etherscan to track and review your transactions.

4.Regularly Check and Remove Unnecessary Website Connections

Periodically review and remove unnecessary website connections in Metamask to enhance security. You can do this by going to Metamask > Click on the three dots > Connected Sites. Delete any unnecessary connections.

5.Revoke Permissions

During usage, you often grant permissions for third-party applications to use tokens in your wallet. Be sure to review and revoke permissions for apps you no longer use. This prevents unauthorized access to your funds.

6.Use Revoke Websites

*Some websites can help you revoke permissions easily:

Revoke.cash
Approved.zone
Tac.dappstar.io
Beefy.finance

7.Avoid Accessing SCAM Websites

On your computer, create bookmarks for legitimate cryptocurrency websites like CoinMarketCap or CoinGecko. Avoid clicking on random links and always access cryptocurrency-related sites through these bookmarks.

8.Protect Your Browsing and Email

*Use secure operating systems like Windows 10 or higher.
*Enable virus protection and firewalls.
*Avoid using devices for entertainment and accessing potentially risky websites on the same device where you store your assets.
*Consider using a separate device for asset storage.

9.Prevent Browser Hacks
*Use a separate Chrome profile solely for syncing, saving, and storing login credentials.
*Enable two-factor authentication for your Google account.
*Regularly check your Google account security settings, including device access.
*Be cautious when clicking links in emails and verify the sender's email address.

10.Protect Against Network Attacks
*Avoid using public Wi-Fi networks, as most asset losses occur on them.
*If necessary, use a paid VPN service to encrypt your data.
*When outside, use your mobile data (4G) instead of public Wi-Fi.
*Disable all sharing features on your mobile device.

11.Verify Contracts and Charts
Before participating in DeFi projects, double-check the contracts and use links from trusted sources rather than searching for them independently.

12.Use Audited and Trusted Wallets
Opt for wallets that have been audited by reputable organizations and regularly update their features and fixes. Examples include Metamask, Trustwallet, and Coin98.
Remember that security is paramount in the world of cryptocurrencies. By following these precautions, you can significantly reduce the risk of losing your assets.

1. There Will Be Relief Waves in a Downtrend
Nothing goes down forever or up forever. In a downtrend, there will inevitably be relief rallies. As Ryan mentioned, there will be several deep drops in a year. You can apply this knowledge to catch these rallies.

2. Most Projects Won't Reach Their Previous Highs
Projects like XRP, EOS, QTUM, and last season's DeFi projects significant raised capital but couldn't find their peaks this season. This is because new projects with better technology and #DevelopmentTeam s are emerging. The interest in older projects is waning, they are overvalued compared to their real value, and many have already taken profits, especially for fundamental and platform coins.

3. BTC Leads the Market, ETH Leads Altcoins
BTC, born in 2009, has faced numerous challenges and legal issues. It has survived and continues to attract both big players and strong community support. When the market grows, it receives the first wave of investment and leads the market upward. ETH, with its smart contract technology, serves as the foundation for most blockchain platforms. To predict market trends, observe the ETH ecosystem.

4. Downtrends Are Market Cleansing
In the crypto market, various elements like builders, traders, developers, and whales participate. Some components, such as speculators, don't add much value but are necessary for liquidity and market excitement. Downtrends cleanse the market of non-valuable elements. The crypto market is still in its infancy and has potential.

5. Truly Good Projects Survive Downtrends
The financial market has cycles, and the lessons from the growth cycle of 2021 show that good projects emerge during the crypto winter. In 2018, coins like SOL, AVAX, DOT, and NEAR were born. Besides holding onto existing projects, watch for new ones.

6. Each Downtrend Is Different
This downtrend is larger in scale than the previous one. The participants and technology are different. The market evolves, so don't apply old knowledge to the new market. Stay updated, as human psychology is a critical factor.

7. The Market Grows After Each Downtrend
Currently, the crypto market's capitalization is small, but its potential can reach values similar to other financial markets. Despite legal constraints and negative perceptions, the market continues to develop and grow.

8. Priorities During a Downtrend
a. Balance your portfolio by holding top coins like BTC and ETH. Few people hold both, but they should be a priority. Increase your stablecoin reserves, cut losses on junk coins and meme coins, as most projects won't reach their previous highs.

b. Reevaluate your investment approach, including valuation, capital management, information search skills, and the ability to turn information into insights.

c. Maintain an open mindset and consider a bottom perspective to learn from changing market conditions. Offer a more objective view of issues.

d. Hold more cash than invest because in a downtrend, the trend is to withdraw cash from the market. Going against this trend can lead to more losses.

e. Avoid Dollar-Cost Averaging (DCA) against the trend, as it can increase losses. Only DCA if you are willing to buy at the price you can accept

The crypto market is a highly volatile and rapidly changing industry, making it a challenging investment environment for investors. However, with appropriate applied strategies, you can manage risks and protect your investments. Risk is an unavoidable factor in investing, especially in the crypto market. A successful investor is one who can balance risk and reward.

I. Why Risk Management is Necessary?
Because in financial markets in general, and the crypto market specifically, everything is probabilistic, and nothing can be certain 100%. Unexpected factors can always arise, which is why good risk management helps minimize losses. While other factors like knowledge, time, experience, and understanding are crucial, not knowing how to manage risk can potentially wipe out all your earnings in an instant.

II. Risk Management Strategies

1.Portfolio Diversification
a. Adjust Portfolio According to Risk Levels
Divide your investment portfolio into high-risk, medium-risk, and low-risk categories. Then, allocate appropriate proportions based on your individual investment style. A portfolio heavily weighted towards high-risk investments can be imbalanced. Profit often comes with risk, so balancing your portfolio and managing risk involves diversifying your crypto assets according to your investment style.

b. Allocate Capital Wisely
Because there's always a risk in investing, you need to allocate your capital wisely. The future is unpredictable, and you can't be certain that any of your investments will win 100%. Even with thorough analysis, unexpected events can happen. Therefore, planning how to allocate capital among different cryptocurrencies will make you feel more comfortable, as you've spread the risk across a range of assets.

c. Regularly Monitor Investment Progress
We can't always predict market changes accurately, leading to losses and portfolio burnouts. Therefore, you should monitor your assets to eliminate risks from misjudging market trends. Using cryptocurrency portfolio management apps helps investors stay on top of their accounts and make appropriate adjustments. Be responsible for the money you invest!

Some portfolio management tools:

CoinTracking: Offers various portfolio tracking features, including real-time balance updates and profit/loss tracking.
CryptoCompare: Provides portfolio tracking functionality, allowing you to view your portfolio's real-time value and historical performance data.

2.Avoid Letting Emotions Affect Your Trades
Personal emotions are the number one enemy of traders in financial markets. When a decision is based on emotional factors, it's not truly honest or objective. Here are some tips for controlling emotions while trading:

a. Maintain a Long-Term Perspective: Crypto markets can be highly volatile in the short term, so it's important to have a long-term view and not get caught up in short-term fluctuations.

b. Don't Chase Profits: Avoid the temptation to chase profits by investing in a cryptocurrency or project just because it's surging in value. Instead, stick to your investment thesis and focus on fundamental principles.

c. Don't Panic: If the value of your investment, don't panic and sell off your portfolio. Instead, take a step back, review your investment thesis, and determine if the investment still holds value.

d. Avoid FOMO (Fear of Missing Out): FOMO is a common emotion in the crypto market. Don't feel compelled to invest in a cryptocurrency or project just because others are doing so.

e. Avoid Overreacting: Avoid overreacting to news or market conditions. Instead, take the time to research and understand the situation before making any investment decisions.

f. Take Breaks: If you find yourself emotionally invested in your trades, take breaks and come back with a clear, rational mindset.

Avoid Overtrading
It's essential not to trade excessively, as overtrading can lead to poor investment decisions and excessive trading costs, sometimes without covering profits. Frequent trading can also lead to incorrect investment decisions due to emotions like fear, greed, and overconfidence. It's challenging to time the market, and if you're constantly trading, you may miss long-term profits while bearing short-term losses. Trading too often can indicate impatience, a critical quality in the cryptocurrency market, where short-term volatility is common.

Note: There will be unexpected events in life and in the crypto market, so be flexible in adjusting your plans. Only sell or adjust your long-term coin portfolio for the following reasons:

*When you need the money for essential living expenses.
*When you want to rebalance your investment portfolio by adjusting asset allocations to optimize profit and minimize risk.
*When you need funds for reinvesting in your portfolio, such as selling some BTC to allocate it to a more promising coin.

WHY NOW?

*The number of participants in the market has decreased significantly, creating opportunities for those who remain. Instead of competing with hundreds or thousands of others during an uptrend, the competition has decreased significantly. With fewer users, projects may need to conduct more airdrops to attract users in this context.

*Gas fees on various blockchains are currently very low, making transactions affordable. For example, transaction fees on the Optimism or Arbitrum networks are below $0.1 per transaction.

*Projects are still being developed during this downtrend, which can be seen as a sign of their commitment.

HOW TO DO AIRDROPS?

1.Retroactive Airdrops:

*Directly engage with the project on their platform.
*It may not require any fees if it's on a devnet or testnet (e.g., Sui Network, Sei, Quai).
*It may require fees if it's on the mainnet (e.g., Optimism, Arbitrum).
Bounty Airdrops:

Complete tasks involving interaction with the project's social media channels, such as Telegram, Twitter, Facebook, etc.
This method is relatively easy but might have lower rewards.

PRACTICAL TIPS:

I. Create Accounts:

*Use the Chrome Profile feature.
*Create a combo account with the same email and a new wallet address for each Profile (remember to save the private key).
*If Twitter or Discord requires a phone number, borrow one from a friend or family member.
*Use a VPN with a fake IP address for creating additional combo accounts to avoid potential IP-based checks.

II. Experience the Project:

*For projects on Devnet & Testnet (e.g., Sui Network), do tasks without worrying about fees.
*For projects on Mainnet (e.g., Arbitrum & Optimism), be prepared to spend some money on gas fees.
*Keep detailed notes on each transaction, especially for DeFi projects that involve swapping, adding liquidity, staking, etc. Some may have minimum time requirements before you can unstake or withdraw liquidity.
*Verify the authenticity of links to avoid scams.

III. What If You Win?

*Projects often notify winners through email, and having multiple combo email accounts helps you identify which wallet won faster.
*Claiming tokens might require a small amount of the project's native token as a transaction fee (not to be confused with transferring tokens directly to your wallet). Claiming quickly can allow you to lock in a good price.

MORE INSIGHTS:

*In the past, some airdrops rewarded early users with significant amounts. Examples include Uniswap, 1INCH, Paraswap (over $10,000 per wallet), Optimism ($1,000 per wallet), and recent ones like Aptos (I earned around $1,500 twice) and Hashflow (free NFT minting, sold for 0.2 ETH).
*Airdrops can change your financial situation and help you understand how markets work.
*Consider creating multiple accounts (wallets) for airdrops, as the number of accounts depends on the project, your resources, patience, and your available funds.
*Sometimes, you may have to wait for six months to a year for results, and there's no guarantee that airdrops will happen.

CURRENT AIRDROP OPPORTUNITIES:

Some airdrops worth considering are Optimism NFT Quest, Arbitrum 4 Quest, Sui Network, Sei, Layer Zero, Starknet, Pontem, etc.

This article will provide you with basic concepts and insights into how token allocation and release schedules work. It's especially useful for newcomers who may not be familiar with the term "tokenomics."

In addition to supply and demand factors and token utility, you should also understand the following elements:

1. Token Sale:
Token Sale is a method for project teams to raise funds for project development. It helps us determine the price at which they obtained tokens, including various key rounds:

- Seed Sale: This is the earliest round where investors, often angel investors or close associates of the project team, acquire project tokens. Since tokens are sold at the lowest price during this round, it carries the highest risk and potential profit.

- Private Sale: In this round, tokens are sold to investors or funds like Alameda, Binance Labs, Coinbase Ventures, or A16z, and the price is higher than in the Seed round. This round decides whether large funds invest in the project based on its progress during the Seed round.

- Public Sale: As the name suggests, this round is for the general community. A well-structured tokenomics plan should lock tokens from the Seed and Private Sales for a certain period to ensure fairness because those who invest later (Public Sale) pay a higher price. If early investors (Private, Seed Sales, etc.) sell immediately, it can harm later investors.

2. Token Allocation:
Token allocation varies depending on the project and its fields. Here is a reference table:

Team: 15% or less
Advisors: Less than 10%
Early Investors: Less than 25%
Public Sale: Less than 10%
Marketing: 10% or less
Ecosystem: At least 10%
Treasury: At least 15%
Liquidity: 20% or less

3. Team:
The core project #DevelopmentTeam  includes developers, founders, and employees. The percentage of tokens they hold should strike a balance:

Too much control by the team can lead to a lack of fairness.
Too little can result in a lack of incentive for the team to develop the project.
Usually, the team allocation falls between 15% and 25%.

4. Treasury:
The project's reserve for future needs, including employee salaries, daily expenses, and product development. A reasonable allocation is around 25%.

5. Seed/Private Sales:
The initial investors who participated in early rounds. Reasonable holdings are around 15%, and caution should be exercised with projects allocating over 20% (as they could be too centralized).

6. Public Sale:
This round is for the community. Usually, it is allocated around 5% because tokens are often unlocked immediately when listed on exchanges, making it easier for early investors to dump tokens.

7. Marketing:
Allocated for marketing activities such as airdrops, retroactive rewards, etc., to reach investors. A typical allocation is less than 10%.

8. Advisors:
The advisory team allocated approximately 5% of the total token supply. An overallocation to advisors can create an imbalance if they have tokens from very early rounds.

9. Liquidity:
Liquidity is added to decentralized or centralized exchanges (DEXs or CEXs). Different projects have varying liquidity requirements, but a good allocation is around 20%, locked for over 2 years.

Token Release Schedule:
Tokens are often released in stages rather than all at once. Consider the following timeframes:

- Under 1 Year: Indicates a lack of long-term commitment to the project's development and may not be the best choice for investment.

- 3-5 Years: This is a reasonable timeframe for releasing 100% of tokens. It shows a strong team commitment and can attract new users.

Over 5 Years: May not be favorable, as the typical crypto project lifecycle is around 5 years, and the market is fast-paced with many projects coming and going.

In summary, this article has covered the essential components of a project's tokenomics. Understanding these elements provides a solid foundation for newcomers entering the crypto market. Thanks for reading!

Some Useful Websites:

Check token scam information: Moonarch, Honeypot, TokenSniffer

Check token release schedules: Token Unlocks, Vestlab

Check upcoming IDOs and ICOs: CryptoRank

Check Tokenomics: Messari

I. PROFIT-TAKING TIPS FOR TRADING

Each trading tool has its own advantages and disadvantages, so it's essential to use multiple tools to increase accuracy (although using too many can be counterproductive). This article will focus on profit-taking strategies without delving into how to use these tools extensively, so it will not be too lengthy.

1. PROFIT-TAKING BASED ON SUPPORT AND EMA:

Profit-taking based on support involves identifying areas with strong candle wicks followed by a pullback and a bearish reversal (in the previous timeframe). You would place a sell order right at that support zone.

Profit-taking based on Exponential Moving Averages (EMAs) (using EMA34 and EMA89) is effective on daily (D) or 3-day (3D) charts and even more accurate on weekly (W) charts.

For example, let's look at the 3D chart of BTC. You can see that since February 28, 2022, BTC consistently faces resistance when touching EMA34 or EMA89 on the 3D timeframe, even without considering fundamental analysis or economic conditions. In this case, you would consider taking profits when the candle reaches EMA34 or EMA89.

2. PROFIT-TAKING BASED ON RSI:

Profit-taking based on the Relative Strength Index (RSI) involves selling when the RSI enters the overbought region, typically above 70.
When using RSI for profit-taking, it's crucial to consider other resistance factors. Not every cryptocurrency reverses its trend just because the RSI enters the overbought zone.
Combining RSI with candlestick patterns and RSI patterns (such as bullish or bearish divergences) can result in a higher win rate.
For more detailed information on trading tools, you can refer to Aden Nguyen's cryptocurrency trading channel on YouTube.

3. PROFIT-TAKING BASED ON BOLLINGER BANDS:

The larger the timeframe (3D, W), the more accurate profit-taking using Bollinger Bands becomes.
Bollinger Bands consist of three lines: the Upper Band (UP), Middle Band (MB), and Lower Band (DN).
When the candle is in the upper half of the bands and rises, touching the UP line the uppermost line, it to revert towards the middle band (). In this case, you would consider taking profits when the candle reaches the UP line.
When the candle is in the lower half of the bands and rises, touching the MB line (the middle line), it relative to test it again. If the candle doesn't close above the MB line, it may revert to the lower part of the Bollinger Band, and you could consider taking profits at or near the MB line.

II. PROFIT-TAKING STRATEGIES FOR PRICE RECOVERIES (REBOUND):

1. PROFIT-TAKING USING FIBONACCI RETRACEMENT:

When a cryptocurrency experiences a strong price increase (e.g., x2, x3, x10) and shows signs of a potential reversal, you can use Fibonacci retracement levels (e.g., 0.236) to identify entry points for profit-taking (e.g., 10%, 20%, 30%...).
For example, if the chart shows that the price retraced to the 0.236 Fibonacci level after a significant pump, you may consider taking profits at the next Fibonacci level, such as 0.382 or 0.5.

III. TIPS FOR OPTIMIZING PROFIT-TAKING ORDERS AND EXECUTION:

To ensure that you don't miss out on profit-taking opportunities and to set orders effectively:

1. EASY-TO-EXECUTE ORDER PLACEMENT:

Identify your profit-taking zones from the tools mentioned earlier.
Analyze the order book (buy/sell orders) for the cryptocurrency pair you are trading. Look for where the highest selling volume is located and avoid setting your sell orders exactly at those levels. Set them slightly below or above those levels.
Use odd numbers (e.g., 0.1489 or 0.1449) instead of even numbers when setting profit-taking orders. For example, if your profit-taking zone is between 0.15 and 0.2, consider setting your sell order at 0.1489 or 0.1449.

2. OPTIMIZING PROFIT-TAKING FOR MAXIMUM PROFITS AND STABILITY:

To lock in profits, it's effectively to take profits at multiple levels and avoid the "buy low, sell high" myth, which is often more theoretical than practical
For instance, if you determine your profit-taking zone is between 0.15 and 0.25:
TP1: Take profit at 0.149
TP2: Take profit at 0.194
TP3: Take the rest at 0.249
By using these strategies, you can better manage your trades and increase your chances of maximizing profits while minimizing losses. Remember that trading involves risk, and it's important to continuously adapt your strategies to market conditions.